Public Bill Committee

[Mr. Joe Bentonin the Chair]

Clause 14

The HCA as the local planning authority

Amendment moved [this day]: No. 2, in clause 14, page 7, line 10, at end add—
‘(8) Before exercising its powers under this section the HCA shall undertake formal consultation with the local authority and organise public information and consultation meetings with local community organisations and local people, in respect of any development in the designated area.’. —[Grant Shapps.]

Grant Shapps: I was outlining the purpose of the amendment, which more or less says that formal consultation should take place. Rather than being the informal process that the Minister referred to, whereby this benign agency and benevolent Minister in the future always look to do what is best for the local areas, it should be enshrined in law. A presumption of consultation should be built into the Bill; indeed, more than just a presumption—a requirement. That is what the amendment would do.
It is true to say that from everything we know of the Bill so far, much of its structure replicates that of, in some cases, the authority that it might replace—in this case, the local authority. As such, it can circumvent a large number of requirements that are incumbent on a local authority before it pushes through its plans. I am thinking of district or local plans, which are years in the making. The plans go out to consultation and the authorities talk to local people, consider a variety of different aspects, publish the plan in draft and then publish the final copy. I am sure that hon. Members on both sides of the House have been involved, at one time or another, with their area’s district or borough local plan. We know that that document takes a huge amount of time, energy and effort to prepare. As its requirement to exist is already laid down in law, it is reasonable that that should mean something. The problem with the clause without amendment No. 2 is that the Homes and Communities Agency can ride right across whatever has been decided locally. That endangers the fabric of local democracy—the purpose of electing people who carry out a district plan or, depending on the area, a local plan—and the good work that is done in the plan, and there would be no point in having it in the first place.

Iain Wright: I welcome you to the Chair, Mr. Benton. It is good to see you.
The hon. Gentleman has got to the crux of the argument on the clause and the amendment. Does he agree that if the agency has local development plans conferred on it, it will be required under the statutory planning framework to go out to consultation if it wishes to amend them? It will have the same responsibilities as the local planning authority, and that is where consultation would come in. Is that not the case?

Grant Shapps: I, too, welcome you to the Chair, Mr. Benton.
With all due respect to the Minister, that is not really the issue that we are debating. We are saying that there is a form of retrospective consultation, which comes in only after the HCA has, in effect, ridden into town and taken over some of the responsibilities. Before that happens—before it gets that power—it should first have a duty to consult local authorities. The argument that the Minister presses is that once it has decided to take over those powers it will then, under other clauses in the Bill, have a duty placed on it to consult. Our argument is that it is right to consult up front, and with good reason. For example, in an area where the local authority has already looked at its district or local plan and decided that building houses in a particular location is a good or bad idea—it has already gone through not only the consultation to create that local plan, but also a great deal of local consultation to discuss the issue with local residents and has come to a determination, which let us say in this case is no—it is perfectly possible, with the legislation as it stands, that the HCA will be able to ride into town and override all that local decision-making process.

Andrew Love: I urge the hon. Gentleman to be careful about using emotive words. My concern relates not just to this amendment, but to others that we have debated. There seems to be a competition between the Conservatives and Liberal Democrats to see who can be most slavishly loyal to the local community. Can he see any circumstances in which the local opinion of which he is so supportive might not be appropriate? If we look back a long time to when his party was last in government, it rode over any local opinion in relation to setting up out-of-town shopping centres.

Grant Shapps: The hon. Gentleman’s intervention gives me an opportunity to say that I am absolutely, slavishly loyal to the desires of local people, but that simultaneously I want more houses to be built. An easy way of squaring the circle is to say that local communities must have the power in their own hands—they must have the ability—so that they are incentivised and know that the services are going to follow where the houses are to be built. In particular, as is the case in my constituency, they must be reassured that their local facilities, such as hospitals, are not going to be closed down when the Government are insisting that thousands of homes are built in the local area. It is pretty much common sense to say that if the Government were to frame legislation that incentivised local communities, rather than bash them over the head when they suspect them of being nimbies, they would find that much more housing was built. The problem with the entire direction of the Bill—the clause in particular is a good way of highlighting it—is that the temptation is to think that everything has to be run from Whitehall. It does not; it can be run from local communities.

Alistair Burt: Will my hon. Friend take into account—is he aware, indeed—that the operation of housing finance and local authority taxation has now reached the stage where in some areas building more houses costs the council money? They do not get anything back from it in local tax and more money goes out of their area. What incentive is there for them to build houses, which we all want to see, and to reach the Government target? Surely the approach that bottom-up is best is the right way to go.

Grant Shapps: My hon. Friend makes an outstanding point because it shows precisely where the Bill has missed the game in town. It should enable communities to expand where they want to—where they are incentivised to. One of the ways to do that would be to allow them to take the gain from having a wider and larger council tax base, but the Bill does not address the issue. It fudges it; it insists that those matters have to be run centrally. They do not. If 10,000 more homes are built in one’s patch, those people will pay council tax. If they pay council tax, politicians can stand for election in that area with a reasonable expectation of offering lower council tax or improved services, but only if the Bill allows for it. However, it fudges it and it misses the point.

Iain Wright: The hon. Gentleman mentioned the word “incentivise” a number of times. Will he therefore welcome the concept of the housing and planning delivery grant of around £510 million, which my right hon. friend the Minister for Housing announced several months ago? It is precisely for that purpose—to ensure that where local authorities have the responsibility to identify where housing needs are necessary, they will be incentivised. Why did his Front-Bench spokesmen go out and say that that was blackmail? Surely those statements are at odds. The grant is either incentivising or it is blackmail. I do not understand the Conservatives’ position on this.

Grant Shapps: I thank the Minister for that as it gives us a chance to clear something else up. I welcome the grant. It is a small way—relatively small, in housing terms—of incentivising. It takes over from the earlier grant, which was, I think, the housing plan and I welcome that. However, I was also the one who said that it looked like blackmail because—I shall explain this clearly to the Minister—it comes from the same Government who still fail to recognise that local people should be put in the driving seat. The figures involved when compared with the cost of building 3 million homes over a period of time, or even the limited time when the grant is available over the next few years, are relatively trivial. It is symbolic of how the Government think that all they need to do is to hand down money from above. That is not how we should go about incentivising communities. I am pleased the Minister has a real interest in incentivising and that the clause has sparked his interest in the subject.
The way to incentivise communities is to use the money from within the community with reformed section 106, the wider council tax base and by not having one part of the Government working against the interests of another part of the Government—for example, when a hospital is closed but more homes are built. If we get the whole system working in tandem, true localism will mean that we work to incentivise from the bottom up. The Minister seems to believe that the only way in which we can incentivise is to push money down from the top and direct it centrally. In a sense, that is the problem with the Government’s approach.
Mr. Nick Raynsford (Greenwich and Woolwich) (Lab) rose—

Grant Shapps: I want to ensure that we address the detail of the clause. I will take an intervention if it is on that.

Nick Raynsford: I refer the hon. Gentleman back to the evidence session, our third sitting on the morning of December 13. I think he was in Committee then. He will recall me asking representatives from the Campaign to Protect Rural England about the individual circumstance of a development on a brownfield site—an infill development in an urban area with more than adequate infrastructure, hospitals, transport, all the rest—that was turned down by the local authority because of the feelings of local people who did not want housing on that site. Without the ability of the developer to appeal to the Planning Inspectorate and its decision that the development was in accordance with the London plan, those houses would not have been built. Does he recognise that it is not just a question of incentivising communities? There are tensions and conflicts, and we have to have a framework where the Government can ensure that the overriding need for housing is met where it is essential, and that where communities are wrong to oppose new housing, that can be overridden.

Joe Benton: Order. I must ask members of the Committee to make their interventions a little shorter.

Grant Shapps: I am grateful for the intervention none the less because it gives me the opportunity to say that the problems in the market are a result of the marketplace as it is—of our planning laws as they are. When those circumstances happen, and I recall the right hon. Gentleman’s exchange with the CPRE, they are because of the status quo. However, the Bill is not about the status quo; it is about changing the future. There is barely a politician in this country who is not elected on the basis of being anti-development, because politically that makes sense in their areas.
 Mr. Raynsford indicated dissent.

Grant Shapps: Surely the right hon. Gentleman recognises that he is one of the very few exceptions up and down the land. The reality is that local people have legitimate concerns. The problem with the framework of the legislation in terms of planning and housing is that it fails to recognise those legitimate concerns. I am trying to describe a situation, with the help of the clause, that would shift us to a position in which people in this country could, finally, be elected on the basis of being pro-development politicians. When that happens over two or three electoral cycles—when we have people in this country who have stood for election saying, “Yes, I’ll back those 10,000 houses over there, but in return we’re going to keep this local hospital open. I’ll back those 10,000 houses, but we’re going to use section 106 to rebuild our town centre. I’ll back those 10,000 houses, but we’re going to keep the council tax receipts to ensure, over a tapered period of time, that we can provide better services to the local community”—and when there is something in it for local people, they will vote for it.

Joe Benton: Order. The hon. Gentleman is moving slightly away from the amendment. There has been a tendency to do that. I am trying to be as free as I can, but we must stick to it.

Grant Shapps: I am grateful, Mr Benton. I am slightly goaded by questions that take me off into the wider area, as you rightly point out.

Sitting suspended for a Division in the House.

On resuming—

Grant Shapps: I was moving towards the conclusion of amendment No. 2 to clause 14.
What I want to reflect on is the Minister’s earlier intervention, which suggested that, because consultation would take place after the HCA had taken over a development, that would be sufficient. We on this side of the House argue that that is not sufficient; that, for all the reasons that we were debating and discussing for the 10 minutes before the Division, it makes sense to require that sort of consultation in advance. The amendment simply states:
“Before exercising its powers under this section the HCA shall undertake formal consultation with the local authority and organise public information and consultation meetings with local community organisations and local people, in respect of any development in the designated area.”
The purpose is quite simple: to ensure that local people cannot be ignored in a process that might otherwise ride roughshod all over them.

George Young: I congratulate my hon. Friend on what he has just said, and he need make no apologies for the passion injected into some of the earlier sections of his speech. I want to support amendment No. 2, which seeks to soften any injustice that might be done between the existing local plan and the proposals that the HCA have for that area.
I think I am right in saying that every part of the country is now covered by a local plan. The plan has gone through an exhaustive procedure, the Minister has had the power to intervene and amend it if he so wishes, and it is then adopted. The thrust of planning policy for the past 20 years has been to inject more certainty into the planning process, so that people know that what is in the local plan is going to happen, and it is less likely that an appeal will succeed. That is the context in which clause 14 and amendment No. 2 should be placed, as clause 14 allows the HCA to become the local planning authority.
We discovered this morning that the Government have at present no plans to use those powers in any part of the country. I found that a helpful comment. In an intervention a few moments ago, the Minister said that the HCA would have the same responsibilities as the local planning authority. Will he confirm that when he replies? The local planning authority has to go round quite a protracted course in the preparation of the local plan. The Minister said that the HCA has the same responsibility: will he confirm that it will have to do exactly what the local authority does when it comes up with its alternative proposals for the designated area?
It would also be helpful to know whether the Minister can call in something that the HCA proposes to do as the local planning authority. Is it susceptible to the same power of intervention—in respect of what it is seeking to do—as a local authority? Is it the case that, under this clause, the HCA, if it were designated for the whole of a local authority area, could simply produce a new local plan? As I understand it, that is exactly what is proposed.
In an earlier debate, the Minister said that the objective of the HCA in this part of the Bill was to give additional help and support to a local authority. I take that to mean help and support in enabling the local authority to deliver what is in the plan, which is a wholly admirable objective. But this is something slightly different: the proposal is not help and support for the local authority in doing something that it is struggling to do, but a change to the land use of the area of the local authority. Will the Minister sketch in the circumstances in which those powers will be used, and the process that the HCA will go through as the local planning authority? Will he confirm that it will indeed have to do exactly what the local authority did when it came up with its original local plan?

Lembit Öpik: If the Minister is confident that it will be incumbent on the HCA to respect the responsibilities outlined by the two previous speakers, will he cite where in legislation that commitment is enshrined? Such a commitment would ensure that the HCA fulfils the obligations that have been highlighted and that the amendment seeks to put back in.

Iain Wright: May I ask the indulgence of the Committee, and of your good sense, Mr. Benton? We were talking about something this morning, and I promised to go for a walk and look into the skies to seek clarification. I had a very pleasant walk in St. James’s park, and I would like to put on record the issues raised by the Committee regarding my amendments to clause 14.

Joe Benton: Order. I have no objection in principle to putting those matters on the record, but I doubt whether it is appropriate to do so under this amendment. I suggest to the Minister that he refers to them in the clause stand part debate.

Iain Wright: That is extraordinarily helpful, Mr. Benton. I do not want to undermine your authority, but Mr. Gale gave the Committee the impression that we would not be having a clause stand part debate. However, I am happy to take your point on board.
We have had a very interesting debate and teased out an awful lot of the fundamental, if not ideological, differences between the two main parties. I was fascinated by the hon. Member for Welwyn Hatfield’s somewhat contradictory position: being in favour of incentivising local authorities, but when it happens saying that they are being blackmailed and that it is a top-down approach. The £8.5 billion that we have pledged to affordable housing, which is a 50 per cent. increase on the previous comprehensive spending review period, is a massive incentive that will be spent locally. Local authorities are key to this matter.

Grant Shapps: I do not want the Minister to remain confused, so I will try to explain what he views as an contradiction. It is not a contradiction. One element is the reality of the situation as it stands at the moment. We welcome the money that will come down in order to encourage development, but I ask him to keep it in mind that that is not the reality that we would like. We are able to dream that in the future we will have legislation under which that would not be the best way to handle housing development. Therefore, we can both praise the amount of money and call it a cynical bribe if future legislation is not very different from this Bill.

Iain Wright: I maintain—I saw this on Second Reading—that the hon. Gentleman fully agrees with more homes as long as they are nowhere near his area. That is the sense that I get from Tory Members: “We do need more houses, but nowhere near us.” There is an element of, “Lord make me pure, but not yet” about it. I think that there is a touch of hypocrisy.

Lembit Öpik: If the Minister holds that point of view, surely he should take on the amendments to ensure that the Conservative party cannot mess up the noble plans that we all claim to have for building new houses.

Iain Wright: That is an interesting—and short—interjection. [ Interruption. ] Obviously, I fully agree. To be fair, the Liberals do not have many supporters, so they have to say themselves that they are brilliant. However, I am happy to concur with that point. This has been an important debate about quite an important amendment. The whole Committee would share the view that public engagement, including consultation on policy development and service design, is an important part of a modern, representative democracy.
 Alistair Burt rose—

Iain Wright: Before I start my rhetoric, I will give way.

Alistair Burt: I cannot let a particular point go. The Minister was keen to indicate that Conservative Members are fierce in defence of their local areas if they feel that they are inappropriate for development. He used that to indicate that we are against development. He must address the point that Cabinet Ministers, including the Secretary of State for Transport, the right hon. Member for Bolton, West (Ruth Kelly), have been featured in the press as being fierce opponents of planning developments in their constituencies. He cannot avoid the point that Members will act in defence of their own interests. That applies to Members on both sides of the House, including Ministers. I cannot see that he can get away from that.

Iain Wright: To that I say that it is entirely consistent for hon. Members to reject planning developments in their areas when they are inappropriate in terms of poor design—that is a particularly important point—or if they do not think that they are in the right areas; I would encourage hon. Members to reject such planning developments. That is not inconsistent with saying that we need more homes. On my own patch, there is a real need for affordable social housing and I can think of a particular area where it would be appropriate. I do not think that the local authority will put something there, but I will be campaigning for more homes in that area. It is right and proper for Members of this House to be representatives for our own constituencies. Hon. Members should have a view as to where appropriate developments could take place. That is not contrary to my point.

Alistair Burt: May I just finish my point? If what the Minister says is the case, he should move away from rhetoric that says, “Oh, it’s only Members on the other side who do that”, because that was what he said. It is like using a year zero argument—he suggests that nothing happened before 1997, and only Conservative Members object to housing developments. That is not the case. If he is now making the point that Members act correctly when they defend the interests of local communities over a development that they think is inappropriate, or when they support planning developments that they think are right, he should acknowledge that that affects Members on both sides of the House. It is not a party matter as he indicated.

Iain Wright: I appreciate that comment. I respect the hon. Gentleman enormously and I think that his views are sincerely held. However, I spend a lot of my time answering correspondence from Members on both sides of the House. A high proportion of correspondence from Opposition Members relates to development and housing, and says, “We don’t want development in our area”. Contrary to that, I receive letters from Labour Members that say, “Can we have more houses please?” There is a dividing line between the parties on this matter. We welcome the need for more homes and embrace it. To address the significant challenges that we have had for a generation, we need more homes, but I think the Opposition believe that we do not.

Alistair Burt: We must finish this point, because we will not agree on it. He made a strong point, but it sits ill with the action taken by the former Secretary of State for his Department, the right hon. Member for Bolton, West, because she would cause the Minister concern on those grounds. The Opposition do not accept what the Minister said. Those on the Conservative Front Bench have made it clear that we want more development. As my hon. Friend the Member for Welwyn Hatfield—he is leading the fight—said, we want to encourage more development and to help the Government. We are doing that by indicating that a bottom-up approach is better than a top-down approach. That is the issue between the parties and I do not believe that we will agree on it. For the record, that is the appropriate description of the position of the Conservative Front Bench.

Iain Wright: I acknowledge the hon. Gentleman’s point, and I too want to move on. However, I reiterate that my correspondence tells me that there is a party political divide on the matter.
It is right and proper that consultation is recognised as a key stage of engagement with public and stakeholder organisations. It ensures that decisions are informed, because we will listen to those who might be affected by new proposals. I would suggest that the Government have done more. We are going back to the year zero approach that was described in an earlier sitting. Since 1997, the Government have done a lot to ensure that local people have much more say on decisions that will affect them, which is right and proper.
I believe that that was the sentiment behind the amendment. Although I fully respect the intentions of the hon. Member for Welwyn Hatfield, there is a danger that the measure would lead to a situation in which consultation is an end in itself. The purposes that would be served by such a consultation are served via other routes, and the amendment would add another layer to an already robust process, and a level of unnecessary bureaucracy.
To provide an example, I shall address a point made by the right hon. Member for North-West Hampshire. If development plans are conferred on the Homes and Communities Agency—that is a big “if”, because such a situation would be rare—it would have to engage in consultation before preparing the development plan documents. The agency would need to undertake a formal procedure for accepting representations on plans, hold a public examination of the plan, and comply with the inspector’s binding recommendations on it. In short, it would involve exactly the sort of thing that a local planning authority, possibly a local authority, is required to do. That level of consultation would be required if the agency took over planning powers.

George Young: I am grateful for that confirmation, but is it in the Bill?

Iain Wright: I should be happy to look at the Bill afresh on that matter, but I can say that the sentiments of the Bill are entirely in keeping with it. The clause goes into some detail on the matter.
Placing on the agency a requirement to undertake formal consultation with the local authority, and to organise public information and consultation meetings with local community organisations and local people in respect of any development in a designated area, as set out in the amendment, is unnecessary. Any development would have to be in accordance with the development plan. I have already set out the level of consultation that would be required for the agency to make changes to the development plan documents. In addition, it would have to publicise any applications for development that were made, including any that it was involved with—that will help to address the potential conflict of interest—so that interested parties could comment, as they can with any other proposed development in any part of the local planning authority’s area.
The requirement for additional consultation would be of no benefit to local communities, as it would add no value to existing consultation requirements, and would slow down the regeneration activity that is likely to be desperately needed in such areas. Fewer homes would be built more slowly. As we have seen from the cross-party consensus in the past few minutes about building more homes, which I very much welcome, that is not what the Committee wants. It certainly is not the purpose of the amendment. I therefore hope that the hon. Gentleman will withdraw the amendment.

Grant Shapps: I have listened carefully to the Minister’s arguments. The only one that I want to refute is the idea that I am against development. I am in favour of 6,000 new houses being built in my constituency, 2,000 of which have already been built. I invite him to come to Welwyn Hatfield and explain to local people why we should have 10,000 new homes at the same time as our hospital was last week slated for closure. I hope that he will accept my invitation. In return, I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Amendment made: No. 28, page 7, line 10, at end insert—
‘(8) The Secretary of State may by order amend the definition of “planning-related provisions” or “relevant functions” in subsection (7).’.—[Mr. Wright.]

Question proposed, That the clause, as amended, stand part of the Bill.

Iain Wright: I sought clarification and enlightenment over the lunch break and I should like to update the Committee regarding Government amendments Nos. 23 and 27. I think it may help if I put things into context. When an area is designated under clause 13, functions may be conferred on the Homes and Communities Agency. Clause 14 sets out the functions that may be conferred, including local planning authority functions, for all or in specified permitted purposes, and functions that are non-local planning authority functions but are planning-related.
Government amendment No. 27 sets out which non-local planning authorities have those planning-related functions. In this morning’s sitting, I gave the example of a district planning authority function in relation to enforcement notice registers. Another example would be the hazardous substances authority. If functions are conferred concurrently, the HCA would continue to have a role in the designated area for which it has planning powers, but it will also have some responsibility regarding hazardous substances. Those would work together.
As I said this morning, Government amendments Nos. 23 and 27 are intended to clarify which functions that are not local planning authority functions may be conferred on the agency under the designation order. The hon. Member for Welwyn Hatfield mentioned the Mayor of London. We had an interesting debate on the Floor of the House during oral questions about the Mayor. The hon. Gentleman seemed concerned that the planning functions of the Mayor could be conferred under the Government amendments. I assure him and the Committee that that is not the case. The powers of the Mayor are not touched by the amendments.

Robert Syms: I wish to raise the issue of section 106 agreements and money. If the agency took over an area of a borough, it would effectively, as the planning authority, have to negotiate section 106 agreements and other planning gain. What would the relationship be between the agency and the local authority? I do not necessarily expect an answer today, but will the Minister reflect on that and drop a line to the Committee about how it would work? I presume that there would still be an arrangement with the local authority, because it would have education and others things to do. It is quite important, even if this never happens, that some thought is given, if the HCA becomes a planning authority, as to how the section 106 agreement for planning gain would operate.

Iain Wright: The hon. Gentleman is extremely courteous in not expecting an immediate response. His presumption is correct, but I will clarify that, and ensure that he and other Committee members have sight of anything with regard to that.

Clause 14, as amended, ordered to stand part of the Bill.

Clause 15

Adoption of private streets

Lembit Öpik: I beg to move amendment No. 99, in clause 15, page 7, line 30, at end insert—
‘(8) any resident of a private street may submit a request to the HCA for the adoption of that street.’.
I have tabled the amendment with my hon. Friend the Member for St. Ives, who is on his way. He is also preparing for Government, as we speak. The clause is about the adoption of private streets. It is quite comprehensive in the outline of the requirements for the HCA in that regard, but one thing seems to be missing. There does not seem to be an explicit provision to enable any resident of a private street to submit a request to the HCA for the adoption of that street.
The amendment is born out of a recent experience I had in my own constituency, where the residents of a street in the town of Caersws were desperate for it to be adopted. There was a very strong case for it, but I do not need to go into the details. I had the greatest difficulty convincing the local authority that it was a good idea.
The clause, with the amendment, provides the opportunity of a formal avenue for residents to pursue in order to have their street adopted. Unfortunately for the people of Caersws, the legislation applies only to England, so it is an act of altruism on my part. Should the Minister accept the amendment, I shall seek to lobby the Welsh Assembly to introduce something similar. I hope that the Minister will give a considered response to the logic behind it.

Roberta Blackman-Woods: I have some sympathy with the point that the hon. Gentleman was making. However, I suspect that going from the current situation, in which it is almost impossible to get unadopted roads adopted, to one where residents can simply request that they are adopted and it is done, is too much distance to travel in one Bill.
The Minister will know that, in constituencies such as mine, where there is a huge legacy of houses being bought from commercial quota but streets not being adopted, there is a problem of unadopted roads. I am glad to see the provisions in the clause, even though the circumstances are limited. Any provisions that allow some unadopted streets to be adopted is a move in the right direction. Will he confirm that it is the HCA’s responsibility to identify such streets and to ensure that they are adopted by the relevant street works authority?

Iain Wright: I will take my hon. Friend’s point first, which is an interesting one. My constituency is relatively close to the City of Durham, which is in a beautiful part of the world. I would like to pay tribute to my hon. Friend for the work that she is doing with regard to affordable housing, often against the wishes of the local authority. I think that she has her finger on the pulse in terms of what her local constituents want, rather more than the local authority has, whose political complexion I cannot quite remember at the moment.

Robert Syms: I can tell the Minister.

Iain Wright: I thank the hon. Gentleman.
My hon. Friend the Member for City of Durham raises an interesting point. I have a number of ministerial hats. I have responsibility within the Department for coalfields regeneration. I also have senior responsibility for the housing market renewal areas.
I was in Stoke recently with that hat on, where, in relation to development in the housing market renewal pathfinder area, people were talking about difficulties that they were having with regard to the former National Coal Board. I think that I, and ministerial colleagues in the Department for Transport, need to look into that matter, because a common pattern seems to be emerging on former coal sites—whether they need to be adopted and what the agency could do in that regard. I shall be happy to report back to my hon. Friend, who I thank for raising the point, because it has clicked into place for me other pieces of the jigsaw, for which I am grateful.
The amendment is unnecessary, because there is nothing now to prevent residents of a street asking the highways authority to adopt their street, whether they ask directly, or ask the Homes and Communities Agency to intercede on their behalf. However, I suggest that stating in the Bill that they may submit such requests to the agency would probably—the hon. Member for Montgomeryshire might counter this—raise an unrealistic expectation that the agency will act on their request and serve an adoption notice on the street works authority. Furthermore, it could increase the risk that the agency could be seen as an unofficial appeals process when a street works authority refuses the residents’ request. That is not the purpose of the clause, and nor do I think that it is the purpose of the amendment. The clause is intended to ensure that the investment by the Homes and Communities Agency to improve highways can be properly maintained by the appropriate highways authority. I therefore invite him to withdraw his amendment.

Lembit Öpik: I was the victim of the Minister’s harsh tongue earlier on, and if I may be forgiven for saying so, I regarded his response as intransigent rubbish—I feel a lot better for having said that. He said that having a formal avenue of application for residents might create an unrealistic expectation, yet every year the Budget statement creates an unrealistic expectation, and now, with the pre-Budget statement, we have two unrealistic expectations about the economy. But they are aspirational, and so is my amendment. It would mean that a member of the public—let us remember that we are doing this for the public—can see explicitly that he or she has the right to make an application to the HCA.
At the moment, under the clause, the HCA would be entitled to say to a resident, “I am afraid that we have no provision to allow you, as a member of the public, to make a formal application for adoption.” I understand that Ministers are always loth to modify any Bill on the basis of Opposition amendments, but given that we have already passed a number of Government amendments, the Minister should acknowledge that the Bill is not perfect. I am willing to withdraw the amendment on one condition: that he will, at some point in the next week, have an informal meeting with me, so that I can put my case and allow him to see the logic of my proposal, which is not party political, but common sense. If he can assure me that we will at least have that conversation, I shall withdraw the amendment—but I cannot sit down until he either intervenes, or I push the amendment to a vote.

Iain Wright: I might go down the Hillary Clinton route and say, “I feel deeply hurt by the harsh tongue in the hon. Gentleman’s head”. It is not something that I would expect from him.
I am happy to meet with the hon. Gentleman in the next couple of days to discuss the matter. However, the point about unrealistic expectations is fixed in my mind, and he will need to be very convincing, if he is to persuade me to alter that and to introduce or accept amendments on Report. However, I am more than willing to meet with him—in fact, I desire to meet with him. I should add, given that we are talking about unrealistic expectations, that, as a Liberal Democrat, he should expect nothing less.

Lembit Öpik: I am grateful to the Minister for agreeing to meet with me. He might have an iron first, but at least he is extending a velvet glove. We are a very broad church, with a large tent, and I hope that we can have a serious discussion. There is merit in my proposal, and I shall present to him a range of concerns about creating unrealistic expectations. However, his is a useful offer, for which I am grateful. On that basis, I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 15 ordered to stand part of the Bill.

Clauses 16 to 18 ordered to stand part of the Bill.

Clause 19

Power to enter and survey land

Alistair Burt: I beg to move amendment No. 64, in clause 19, page 9, line 18, after ‘time’, insert
‘on notice as required in subsection (2)(b) below.’.

Joe Benton: With this it will be convenient to discuss amendment No. 65, in clause 19, page 9, line 21, after ‘acquire’, insert ‘compulsorily’.

Alistair Burt: These short amendments deal with the power to enter and survey land. Amendment No. 64 would provide a period of notice for people who may be expected to accept somebody from the Homes and Communities Agency coming on to their land to survey it or to represent the HCA. The other amendment is designed to protect those who may be subject to the powers being applied to them by officers from the HCA. These probing amendments are intended to elicit from the Minister some guidance on how these powers should be used.
The Minister will probably be aware that for a lengthy period, national periodicals such as The Mail on Sunday and other newspapers have run a series of stories concerned with inspectors’ powers to enter people’s property for various purposes, whether to follow up council tax demands, assess the size of houses, photograph bedrooms, toilets and so on, or to support claims being made by the customs and valuation authorities, all of which come from guidance issued by the Government that is available for people to read, and all of which have been rejected by the Government as scare stories, saying, “There is no truth in those things; they will never happen.” However, they have not been able to give a satisfactory explanation of why such wide-ranging powers have been given to officers. We are following up on the same lines today.
We have mentioned on a number of occasions that the agency is not simply a result of the happy merger of English Partnerships and the Housing Corporation: the combination of the two gives considerable powers to the new agency. The potential for conflict of interest for those who acquire, develop and sell on can be considerable. In each area of the agency’s work, there should be a belt-and-braces approach to ensure that the public are not being traduced in any way and that the powers will be used with the greatest sensitivity, whether they relate to inquiry proposals, to the matters we discussed this morning regarding easements for right of way, or whether they apply to the considerable powers given by the Government to those in authority to go on to other people’s property and do various things. There is a need to ensure that we have some idea, through guidance from the Minister, about how these powers are to be used. That is most important.
Amendment No. 66, the Minister will note, would remove the power of the criminal law to be used in relation to an individual who may not know why someone came on to their land if notice had not been given, and who objects to that individual. To invoke the criminal law in those circumstances might be to use a sledgehammer to crack a nut. I ask the Minister to think again about that.
That is the background to the amendments and our concerns. I am sure that the Minister will agree that he does not want to see any more stories in the national papers saying, “Why are this draconian Government taking so many heavy powers to crack down on the everyday citizen?” Here is a chance for him to respond and explain and, by amending the Bill, to give an opportunity for such stories relating to these powers not to appear.

Iain Wright: The hon. Gentleman was extremely helpful. He expressed the amendments in a characteristically thoughtful and sensitive manner, which helped me to sense where his main concerns lie. However, he may have overlooked the proper statutory context of the power.
Clause 19 sets out a power that relates to the process of acquiring land under clause 9, whether those purchases are made by agreement or in exercise of the agency’s compulsory purchase powers. The hon. Gentleman I think recognises that the clause has a strictly practical purpose. Yes, it allows an authorised person to enter a person’s land, but the wording makes it clear that the power arises only in connection with a proposal by the agency to acquire land.
There are only two reasons for which the agency is empowered to enter a person’s land—first, to carry out a survey; and secondly, to value land to assess the amount of compensation to be paid. The clause also authorises entry on to someone’s land in connection with a proposal by the agency to acquire some other person’s land, but that is simply a practical point. It may be necessary for a surveyor to assess a party wall or to access land. Soil surveys will be essential if accurate valuations of contaminated land are to be made, and the hon. Gentleman will be aware that clean-up costs can vary depending on what substances are found.
The amendments seek to limit a necessary power, and I shall respond to each in turn. In general, however, I assure the hon. Gentleman that the power simply enables those same procedural elements that take place in every normal private sale to take place in the statutory context.

Alistair Burt: I am slightly afraid to ask, but are the powers modelled on any other powers, so that we can compare and contrast them—or does the Minister need some inspiration on the question?

Iain Wright: No, I am already inspired. The provision is similar to section 163 of the 1993 Act and is modelled on provisions similar to those found in Acts governing the regional development agencies and urban development corporations.
I turn to amendment No. 64. Subsections (1) and (2) of clause 19 operate together and mean that at least 28 days’ notice is required before an authorised person can demand entry on to land for the purpose of surveying it or estimating its value. Taking the clause as a whole, it is clear that subsection (1) is to be read in the light of subsection (2). I therefore suggest that it is unnecessary to repeat in subsection (1) the notice requirement provided in subsection (2). In that respect, I invite the hon. Member for North-East Bedfordshire to withdraw the amendment.
However, I take this opportunity to tell the Committee that we are considering whether the drafting of clause 19 makes it sufficiently clear that the notice requirements apply in all cases of intended entry. As I said a moment ago, we are clear that subsections (1) and (2) are to be read together, so that notice must be given before an authorised person can enter the land. That is our firm intention, even when land is not occupied in the conventional sense of the word, as referred to at line 26, clause 19(2)(b). We will therefore be considering whether the drafting requires clarification.
Amendment No. 65 would restrict the land that could be entered and surveyed or valued to that which the HCA is proposing to acquire compulsorily. However, it is also necessary for the agency to be able to enter land for surveying or valuation purposes even when the sale is by agreement. In many cases, if land is acquired by agreement the landowner is a willing seller, and I presume that he would be content to allow an authorised person entry on to the land in connection with the sale. The situation is similar to a survey of one’s house, whether it is to survey the property or to value the land. In such cases, I suggest that the agency would not need to enforce its right to enter.
However, the vendor may decide at a late stage in the compulsory purchase process to proceed by agreement, which is some time after the agency needs to enter the land in order to survey and value it. The amendment would hinder the process. With the greatest respect, it is probably contrary to its intended effect and could be quite unhelpful. It could even result in forcing the agency to complete an acquisition via the compulsory purchase route in circumstances in which the landowner would otherwise be willing to sell by agreement. That, in turn, is likely to lead to unnecessary delay in site acquisition. In addition, the amendment may prevent the clause from applying to other situations—for example, if the owner agreed to sell the agency the property, but a tenant of the property did not want to allow the agency access to the land. The amendment is neither necessary nor useful, and I hope that the hon. Gentleman will agree to withdraw it.
If I may turn to amendment No. 66—

Joe Benton: No, amendment No. 66 is due next.

Alistair Burt: I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Alistair Burt: I beg to move amendment No. 66, in clause 19, page 9, line 36, leave out subsections (5) to (7).
I inadvertently referred to this amendment in our previous discussion.

Andrew Love: We were enjoying it so much.

Alistair Burt: The hon. Gentleman and I have a long history of enjoying each other’s remarks in other circumstances—in enlightened Haringey council, where we sat in the early ’80s. My goodness, the definition of “manifesto” and what the Labour party stood for in those far off days are a long way from where they are today, but we will refer to that on another occasion. We have had a long and enjoyable relationship over the years, and I am glad that he still enjoys my remarks—as, indeed I enjoy his. Long may it continue.
Clause 19 will create an offence where an individual obstructs someone acting under the powers of the HCA when entering land. As I have said before, the concern is whether the measure is a little heavy—whether this should be an offence or a civil matter—and whether it will raise the stakes in circumstances where feelings might be running high. There may be a contentious purchase in circumstances that we cannot currently envisage but that we know can occur—over a contested piece of land and a contested issue. Temperatures might be high regarding an HCA purchase and a development that may cause concern locally. Will the Minister consider whether creating an offence is really necessary?

Iain Wright: I suggest that amendment No. 66 has the potential to render clause 19 entirely redundant because it would effectively make the power unenforceable. Why should it not be an offence intentionally to stop someone entering land to survey it or to estimate its value within the framework of the proper exercise of the statutory power? Clause 19 requires the authorised person to be able to produce evidence of their authorisation to enter the land before they do so. Any proposed entry must be at a reasonable time and the Homes and Communities Agency must have given at least 28 days’ notice of the intended entry.
Having gone through those entirely reasonable and standard steps, why should the agency then be unable to enforce its right of entry if someone deliberately prevents its representative from carrying out their duties? I hope that I have reassured the hon. Gentleman about amendments Nos. 64 and 65, but I am surprised that he has pushed amendment No. 66, because he will be delighted to hear that the clause is modelled on an equivalent provision in the Leasehold Reform, Housing and Urban Development Act 1993, as well as on other Acts, such as the Local Government, Planning and Land Act 1980. I imagine that he had something to do with the former measure.
I stress that the powers are necessary to ensure that the purchase of land progresses smoothly, that land is accurately surveyed, and that the seller is appropriately recompensed for the land. That enforcement is important to move swiftly on, and I hope that the hon. Gentleman will withdraw the amendment.

Alistair Burt: The Minister’s good intentions are clear. I wanted to probe him about the reasons for the potential offence, and I am content with his explanation. I would be interested if his Department could supply some information on whether the powers have needed to be used, and whether there have been any prosecutions under legislation as modelled in the Bill.

Iain Wright: I pledge to the hon. Gentleman that I will find out and write to the Committee.

Alistair Burt: I am grateful for the Minister’s assurance, which has been greeted with enormous joy by his officials, who must now look up the information. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 19 ordered to stand part of the Bill.

Clauses 20 and 21 ordered to stand part of the Bill.

Clause 22

Financial assistance

Alistair Burt: I beg to move amendment No. 76, in clause 22, page 11, line 33, leave out subsection (4) and insert—
‘(4) The terms and conditions on which financial assistance is given shall, in particular, include provision as to—
(a) the circumstances in which the assistance must be repaid, or otherwise made good, to the HCA, and the manner in which that is to be done including arrangements in respect of interest and security;
(b) the circumstances in which the HCA is entitled to recover the proceeds or part of the proceeds of any disposal of land or investment in respect of which the assistance was provided.
(4A) Any person receiving financial assistance shall comply with the terms and conditions on which it is given, and compliance may be enforced by the HCA.’.
We now turn to the financial provisions governing the Homes and Communities Agency and a series of clauses on which one or two of my colleagues wish to catch your eye, Mr. Benton.
My amendment puts down a marker on the breadth of the powers. The clause is staggeringly wide, and we will all want to know where to apply for the assistance. The clause states:
“(1) The HCA may, with the consent of the Secretary of State, give financial assistance to any person.
(2) Financial assistance under this section may be given in any form.”
In view of the substantial powers in the clause and the agency’s power, it is not unwise to ask the Minister for guidance on how the powers will be used and what accountability there will be.
I will not dwell on the matter, but I will simply say that, as the Minister will be aware from Question Time in the House today, concerns are being raised in the news about the London Development Agency and the problems associated with the giving of large amounts in the circumstances that are being investigated. That, understandably, raises in the public’s mind concern about the power of the Government or their agencies to handle large sums of public money and to distribute it. To try to ensure that before we get to the stage of worrying about where the money has gone, who might be responsible and whether it is being misused, there should be sufficient checks in place to ensure that that is not an issue, or at least no more of an issue than it is in the normal run of affairs involving public bodies that must be accountable with proper audit.
That is the reason behind my amendment, which, in some cases, would provide guidance. It would assure the public that there would be provisions to ensure that the Secretary of State had regard to the repayment of money and to the setting out of circumstances. That would protect the HCA in cases when there might be a problem recovering the money.
If we can move slightly beyond the amendment to the clause as a whole, I should be grateful if the Minister would assist us. The clause states that financial assistance may be given to any person. Precisely who is intended? The main recipients might be obvious, but who are the unlikely recipients? Where should this money be going? Surely it is very broad to indicate that financial assistance of “any form” may be given to “any person”. As I said earlier, where do we all apply? There must be some rules that the Minister is already considering, so let us have some sense of what they might be. I fully appreciate that they must be in line with the objects of the agency, as set out at the beginning of the Bill, but I think that we are entitled to find out a little more.
Again, I stress that the width of the powers given to the agency to distribute finance, as well as the width of the powers given to the agency right the way through the Bill, must be set against the exceptional powers of an agency that can acquire land, develop it and sell it on. Again, I suggest that if one looks at the issues surrounding the housing market renewal initiative in Liverpool—concerns have been raised by Committees of this House about how that initiative has been used and question marks have been placed against the Housing Corporation and the way in which it has handled its responsibility up there—the public are entitled to know just how these powers will be handled and what might happen if things go wrong. That is the sentiment behind the amendment and I would be grateful for some guidance from the Minister.

Joe Benton: Before I call further speakers, can I suggest to the Minister that he responds to the hon. Member for North-East Bedfordshire, who referred to the clause in general, when we come to the clause stand part debate? I call Mr. Öpik.

Lembit Öpik: If we are to have a clause stand part debate, I would like to keep my remarks until then.

Iain Wright: We have had a short debate, but this is an important clause and an important amendment. I understand what the hon. Member for North-East Bedfordshire was striving for by tabling the amendment, but I suggest, with the greatest of respect, that it is not needed.
I like the way in which these themes are emerging in our discussions, but the amendment, which is based on the corresponding section in the Leasehold Reform, Housing and Urban Development Act 1993, would require the agency to attach specific terms and conditions when providing financial assistance, rather than allowing the flexibility, as is currently the case, to attach such terms and conditions as it feels are appropriate in the circumstances.
Subsection (4) allows for that flexibility. It should be remembered that the agency might be dealing with small local bodies as well as large national bodies when it provides assistance. I think that the hon. Gentleman would probably agree that the terms and conditions attached would no doubt be different in each case. Also, let us not forget that subsection (1) requires the agency to obtain
“the consent of the Secretary of State”
prior to giving that assistance.
The hon. Gentleman asked for further clarification about who would be able to access funding. I would like to put on record that I suggest that assistance would go to agencies that were focused on improving the supply and quality of housing and also on the regeneration of communities. They will be able to access funding from the HCA, and I suggest that that would include registered social landlords, housing associations and local authorities. We have talked a lot this afternoon about the importance of local authorities. We have talked throughout our discussions about the importance of local authorities stepping up to the plate so that they are able to deliver the housing needed in their area. I imagine that they will be able to secure financial assistance from the HCA to do so.

Robert Syms: The Minister has mentioned agencies and local authorities. Under the provision, would it be possible for money to go to private building companies and development companies?

Iain Wright: It is certainly not inconceivable. Yes, it could be possible. I would suggest that “any person” could receive financial assistance in that respect, but it must be given in full accordance with the agency’s objectives. I would suggest that that wide power is needed to enable the agency to meet its objectives. Therefore, I do not really see any merit in placing the agency under a duty to include the conditions in the amendment on each instance that it provides financial assistance. The agency will be accountable for the way in which it handles its finances, and it will therefore be able to account properly for its financial transactions. On that basis, and given the discussion that we have had, I hope that the hon. Gentleman will feel able to withdraw his amendment.

Alistair Burt: I am grateful for the Minister’s response. We have now introduced a slightly different word in that he said that the clause was “based” on legislation, as opposed to being modelled on it. I am very interested to know what the distinction between the two might be. The amendment is based on legislation to reflect the existing provisions relating to the powers of English Partnerships, as set out in section 164 of the Leasehold Reform, Housing and Urban Development Act 1993. The Minister has extended those powers, and I was seeking clarification, which he has given partially, on allowing greater flexibility to the Homes and Communities Agency.
I humbly suggest that further work is needed on the production of information— either from the agency or the Department—about the intention behind these powers, how they will be used and what safeguards there should ultimately be. If the safeguards are not in the Act, clear guidance ought to be laid down. If the Minister can say that there is a commitment to consider providing further guidance on how these powers should be used and explain why he has moved away from the model to a different base, I will probably be prepared to withdraw the amendment.

Iain Wright: I am grateful for that. The way in which the clause has been drafted represents a modern approach. As I suggested earlier, the clause allows the agency, when giving assistance, to have the flexibility to set such terms and conditions as it considers appropriate. I reiterate the point that I made a moment or two ago about the sort of organisations that will receive financial assistance. That could be RSLs or housing associations. As I said to the hon. Member for Poole, it could be private companies. It is important to put it on record that the way in which that occurs will not compromise state aid rules. Given that this is a modern drafting approach, and given my hope that I have clarified some of the hon. Gentleman’s concerns, I hope that he will withdraw the amendment.

Alistair Burt: With that further assurance from the Minister, I am happy to beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Question proposed, That the clause stand part of the Bill.

George Young: I have a very short question to put to the Minister in connection with clause 22(1), under which the HCA
“may, with the consent of the Secretary of State, give financial assistance to any person.”
Clearly, that consent will not be needed, and should not be needed, for every single piece of grant that is given. I am after the HCA’s level of delegation below which it will not have to apply to the Secretary of State for consent, and above which, because of the size of the transaction and the nature of the commitment, reference to the Department will be needed. It will be helpful if the Minister can shed some light on the degree of financial autonomy that the HCA will have under subsection (1).
Looking slightly further ahead, I assume that when we get to clauses 49 and 50, under which the Secretary of State can give directions and consents, one of the consents that he might give would be a derogation in connection with clause 22(1). It would be helpful to have a feel of the confidence that the Minister has in the HCA by knowing the level below which it will be free to dispense public money without reference to the Department.

Lembit Öpik: My point relates to the clause as a whole. It is obvious that the HCA can carry out its work only if it has substantial access to funds and wide latitude to allocate the funds pretty much as laid out in this clause. My great concern is that the Government are notoriously bad at negotiating with the private sector. Time after time, in my life as a local councillor in Newcastle upon Tyne and now as a parliamentarian, I have observed the private sector taking advantage of the naivety of the public sector in negotiations. That is not because the private sector is evil, but because it is motivated to secure the best deal that it can. It sometimes gets a better deal than it could ever have imagined or hoped for when it works with the Government. I therefore ask the Minister what kind of safeguards will be in place to ensure that clause 22—and, indeed, chapter 3 as a whole—does not signal a green light to opportunity and untold profits at the cost of the taxpayer through the HCA. I cannot see a way of avoiding the important financial freedoms the HCA has, but I sincerely hope that this will not be yet another illustration of the Government acting naively in the face of very shrewd operators and costing us billions.

Robert Syms: I have similar concerns. This is an extremely widely drawn clause, and probably rightly so. In order to deliver the Government’s objectives, one clearly needs all the levers here: grants, loans, indemnities, and so on. I do not see how to get hundreds of thousands of homes without involving the private sector and the public sector in some kind of partnership. Who would audit this particular body? Would it be the Audit Commission? Who keeps an eye on all the deals being done under the auspices of the HCA? I really would like to know that, because this could involve joint companies, PFI schemes and a whole range of things in a number of developments in order to meet the Government’s targets, and I am concerned as to what the audit trail will be and how we will keep an eye on what is going on in various developments.

Iain Wright: This is an important debate, and an important clause that sets out the idea that we need to spend money in order to achieve our objectives of 3 million new homes by 2020; but we cannot throw public money away. Clause 22 enables the HCA to provide financial assistance to any person. This power is deliberately wide. Financial assistance is defined to include grants, loans, guarantees or indemnities, investments or incurring expenditure for the benefit of the person assisted. It is mainly through the provision of funding—through, for example, the Housing Corporation’s affordable housing programme, English Partnerships’ regeneration funding streams, and funding for specific programmes such as growth areas and decent homes—that the agency will be able to drive forward regeneration and housing delivery. As we discussed in relation to clause 5, the agency will have the power to build homes directly should it prove necessary, and I was taken by the discussion that I had with the right hon. Gentleman on that basis, in which he probed and questioned me on that. As I made clear, the new agency will not be as well equipped as the house building industry or registered social landlords to play an active role in construction, which is why it will have to be involved with RSLs and private companies. Its role will be focused primarily on providing funding, facilitating work between partners and undertaking projects that make the building of homes in some areas attractive to, and possible for, developers. The agency will build on the successes of the investment programmes of English Partnerships, the Housing Corporation and the Department for Communities and Local Government through an end to funding silos and increased funding flexibility, as I mentioned during the clause 1 stand part debate.
The financial assistance may be given on such terms and conditions as the HCA considers appropriate. This power is absolutely vital to the power of the agency to deliver its objects. A number of members mentioned specific concerns relating to funding delegated limits and the audit trail of the agency. As to whether the HCA would always need to go to the Secretary of State for consent to spend money, there is likely to be a general consent. In relation to the point on clause 10, we will probably have a fairly substantial debate on clause 50 in a later sitting. I note the crucial part in all this played by the agency’s tasking framework and financial memorandum in terms of governance architecture. I have had dealings with some regional development agencies in respect of that financial memorandum and I had responsibility for delegated limits at One NorthEast. I imagine that there will be a similar system for funding delegated limits in conjunction with Government accounting rules and ensuring that good value for money is provided.

Robert Syms: I presume that the homes and communities agency will be both Government-funded and raise money from other sources such as loans.

Iain Wright: Yes, we will move on to borrowing powers later. The hon. Gentleman also asked about the audit arrangements. As a former auditor, I find this incredibly interesting, so I give notice to the Committee that I will be talking at some length about the agency’s auditing arrangements. Let me make it clear: the Comptroller and Auditor General will be responsible for auditing the external audits of the agency. That might be outsourced to a big four firm or whatever, and I imagine that the agency will have an internal audit function to ensure that there is value for money and effectiveness in terms of how it spends and accounts for its cash. That is an important point—I imagine that the audit functions will work in entirely the same way as in the regional development agencies.

Lembit Öpik: I admire the Minister’s optimism and faith in the audit process. Just about everything that the Government do is audited, apart from, apparently, the European Union, but that is another story. My concern is that the audit trail can highlight money that has been wasted, but is unlikely to warn us of money that is about to be wasted. Therefore I ask the Minister again what assurance we can have that the HCA will not end up becoming a massive opportunity for the private sector to make money out of the state by sharp negotiation and the naivety of the Government, as has sometimes been seen in such negotiations?

Iain Wright: In earlier sessions, we spoke about the importance of a good chief executive to provide strategic direction for the agency. I also suggest that an important and strong director of finance or public resources will be key to the implementation and introduction of rigorous financial controls and procedures to ensure that agency money is not wasted. With regard to governance arrangements, I expect that the Audit Commission will have a clear role in ensuring that it is reassured with regard to how the money is spent. That governance framework is key. Again, the importance of the internal audit function, working together with the Audit Commission and providing strong leadership through a chief executive or director of finance, will be key to ensuring that money is not wasted by the agency.

Andrew Love: As a former member of the Public Accounts Committee, may I commend to my hon. Friend the good work carried out by the National Audit Office? May I also bring to his attention the fact that the National Audit Office has had difficulty with the Housing Corporation in relation to following the trail of public money that went from there to other housing bodies that were independently audited by other organisations. It is important to reassure the Committee that whatever arrangements are followed with regard to the HCA, it will be able to help whoever audits the HCA to follow that money trail wherever it may lead, and whatever auditing functions it has.

Iain Wright: I agree with what my hon. Friend says. I am also a former member of the Public Accounts Committee and I really enjoyed my time on it. I suggest that this will be a very high-profile organisation, and in terms of the Prime Minister’s pledge to provide 3 million new homes by 2020, and the key role that the agency has to play in that, it will be entirely appropriate for the board to consider this a major risk in terms of its outputs and outcomes. I will suggest that the director of corporate resources or the director of finance——whatever they may be called——in conjunction with the internal audit function, should ensure that there are absolute, robust procedures in place. They should be able to carry out an audit trail and see where the money has gone and what outputs and outcomes will be provided, so that, for example, the money provided will have created 150,000 homes in a particular year. If I was on the board, I would be insisting that that was the case.

Lembit Öpik: I know that the Minister seeks to provide assurances. For the benefit of the HCA, when it is set up, will he agree on the record that he expects would that the finance director will have overall responsibility and be accountable for the expenditure of the HCA as a whole, and that therefore he or she must be in charge of a financial framework that guarantees that even locally based expenditure decisions are clearly fed into the system, so that it is reasonable to expect the man or woman at the top to have a good handle on the expenditures of the HCA?

Iain Wright: I understand the hon. Gentleman’s concerns, but the chief executive will be the accounting officer of the agency and will be directly accountable to the Secretary of State. There is a robust and rigorous level of transparency and financial accountability.

Nick Raynsford: May I put it to the Minister that this is extremely complex territory and that we should be wary about making assumptions in this Committee about the particular role of the NAO as against other bodies? Clearly, there will be partnerships with local authorities that are subject to the Audit Commission, rather than the NAO. Some of the difficulties that my hon. Friend the Member for Edmonton referred to were in territory where there was doubt as to whether it was appropriate for the NAO to be auditing organisations that were of local significance and subject to another audit framework. It is absolutely right that there must be robust audit arrangements and I hope that when we come to consider the directions and the consents under clauses 49 and 50 we may pursue this, but may I counsel against being too precise at this stage about the exact arrangements that will be in place because of the extreme complexity of the arrangements that the agency will be involved in?

Iain Wright: As ever, my right hon. Friend has made an extremely pertinent point. I reiterate the point that I made earlier on, which is the importance of the tasking framework and the financial memorandum. There will be cake and it will be up to the chief executive and the board to ensure that there are robust, accountable and transparent procedures in place so that the agency receives value for money. I hope that I have reassured hon. Members.

Question put and agreed to.

Clause 22 ordered to stand part of the Bill.

Clause 23

Powers to borrow

Question proposed, That the clause stand part of the Bill.

George Young: I have one or two small points. Looking at subsection (1) about the short-term borrowings of the HCA, will those fall within the financial limits referred to in clause 26 or will they be outside the £2,300 million that is set as the financial limit? Perhaps the Minister could clarify whether they are within the overall limit.
Subsection (1) refers to the short-term management of the HCA’s finances. In the days when we used to have bank managers and I used to talk to them, I often found that their interpretation of a short-term arrangement was somewhat different from my own. I wonder whether there is a definition of a short-term arrangement that would make it absolutely clear whether borrowing fell within subsection (1), or whether it was on a longer term arrangement.
Turning to subsection (2), which is more serious for long-term borrowing, I am intrigued about the HCA’s rather restrictive line of credit. It has to borrow either from the Secretary of State or the European Investment Bank. I am not one of those in my party who gets frantically excited about matters European, but it would be helpful to have an explanation of why the European Investment Bank, alone among many other banks, has the privileged status of being the only one that can lend serious money to the HCA.

Iain Wright: I will be short and sweet. In respect of the right hon. Gentleman’s first point about whether short-term borrowings will fall within limits as per clause 26, I can confirm that they will. On his point about the restricted nature of the agency’s borrowings via the Secretary of State or the European Investment Bank, may I point out to him that that is deliberate and in common with former arrangements with organisations such as English Partnerships to ensure that we are not compromised in respect of public borrowing requirements and state aid? I hope that that reassures the right hon. Gentleman.

Question put and agreed to.

Clause 23ordered to stand part of the Bill.

Clause 24

Loans by the Secretary of State

Question proposed, That the clause stand part of the Bill.

George Young: I want to reflect on what the Minister said just before he sat down, because it may come up again under clause 25. It would be helpful if he could explain something about clause 24. I ask the question out of ignorance. I assume that the HCA will get some cash from the Government as well as having access to loans. Am I right in thinking that the money that it spends will not just be raised by borrowing, but that there will also be a cash budget for the HCA? If so, in what circumstances will the money spent by the HCA be spent out of the cash that is voted to it by the Government and in what circumstances will the money that it spends have to be recovered by a loan, either from the European Investment Bank or the HCA?
In respect of clause 2, when the HCA has to pay interest to the Secretary of State, presumably on the long-term borrowing, it would be helpful if the Minister could confirm that that is the arrangement under which the Housing Corporation and English Partnerships are funded. I should be interested to know the rate of interest that the predecessor organisations have to pay to the Secretary of State on the money that is outstanding by way of loan.

Iain Wright: I am grateful, I think, to the right hon. Gentleman for his questions. I shall give the Committee examples of instances in which the agency needs access to its finances but that is not possible. In such circumstances a loan from the Secretary of State may be the best way forward. I can confirm to the right hon. Gentleman that the agency will receive a grant; it will not raise money solely through borrowing. We expect that the vast majority of spending by the agency will be funded by the grant and that borrowing will probably not be the norm.
The agency needs flexibility in order to achieve its objectives and a grant will be available from central Government. That flexibility is important to ensure that it can have a loan if necessary, which is very much in keeping with former regimes. For example, until 1998 the Housing Corporation provided loans to registered social landlords to help to develop new social housing. Those loans were funded by short-term borrowing from the national loans fund; the corporation’s remaining loans portfolio, which covers core ownership loans and guarantees, is part-funded by short-term borrowings from the national loans fund, which is at present about £1.4 million. The reason for the borrowing is purely historical, as all loans were funded by borrowings.
The right hon. Gentleman wanted to get a flavour of how often that sort of borrowing takes place. English Partnerships has never borrowed or received a loan from the Secretary of State. As I said a moment ago, the Housing Corporation’s borrowing is largely historical but remains current in that respect. The Department did not provide any grant in aid as financial assistance to fund redemption of the loans in the Housing Corporation’s loan portfolio. Any borrowing from the new town development corporations was funded from the national loans fund.
The proposal provides flexibility and another source of reasonable and prudent funding, but it will probably not be the norm in how the agency funds its activities.

Question put and agreed to.

Clause 24 ordered to stand part of the Bill.

Clause 25

Guarantees by the Secretary of State

Question proposed, That the clause stand part of the Bill.

George Young: I have another short intervention on loans that are guaranteed by the Secretary of State. The Minister said that in an earlier life he was an auditor. That means he has removed the excuse of ignorance for the question that I am about to put to him. Will the guarantees given by the Secretary of State under this clause score so far as the public sector borrowing requirement is concerned? Will they form part of the calculation towards the golden rule? The clause makes it quite clear that if the Secretary of State gives a guarantee, Parliament has to be told about it, so the information will be in the public domain. It would be helpful to know whether the guarantees given under this clause will go towards the total liability of the Government and therefore score against the PSBR and the Chancellor’s golden rule?

Robert Syms: As we discussed under clause 22, the HCA can give guarantees or indemnify the projects. Under clause 25 would this be under the financial limit of £2,300 million or above it? In other words, it is possible to have a cash borrowing limit for the HCA but have additional liabilities on its balance sheet. How would that be treated?

Iain Wright: I will answer the hon. Gentleman first because that is the easier question. The £2,300 million is the absolute limit. Everything is contained within that. In respect of the right hon. Gentleman’s question, I was a very bad auditor which is why I had to become a Member of Parliament. I cannot provide a great deal of clarification on his very pertinent point about the golden rule. If he allows, I will look into that and try to find inspiration in the short to medium term and then respond to him and provide information to the Committee.

Question put and agreed to.

Clause 25 ordered to stand part of the Bill.

Clause 26

Financial limits

Alistair Burt: I beg to move amendment No. 3, in clause 26, page 13, line 2, leave out ‘£2,300 million’ and insert ‘£1,000 million’.

Joe Benton: With this it will be convenient to discuss amendment
No. 4, in clause 26, page 13, line 5, leave out ‘£3,000 million’ and insert ‘£1,500 million’.

Alistair Burt: The aim of the amendment is to elicit from the Minister an explanation of why the financial limits are as they are. I should be grateful if he could set that out.

Lembit Öpik: I just want to highlight the complete pointlessness of subsection (3). Subsection (1) states:
“The current borrowings of the HCA must not exceed £2,300 million.”
Subsection (3) states:
“But an order under subsection (2) may not specify an amount of more than £3,000 million.”
As the Minister said himself, what is to stop anybody through an order changing the legislation to any amount at all? There is no prospect of subsection (3) doing anything useful. The amendments offer different sums. I think that the amount the HCA spends will end up being far in excess of £2.3 billion or indeed £3 billion. If it gets its momentum and if the house building programme that we need in this country is to benefit significantly from the investment through the HCA, the sums will have to be far higher than what has been put forward here.
The Minister, being so keen to maintain a frugalness of content in the Bill, needs to explain why subsection (3) is there. There may be an administrative reason. Perhaps there is a standard precedent in legislation of which I am not aware. But in the absence of those, while subsection (1) is meaningful, because it indicates some initial HCA borrowing limit, subsection (3) is meaningless, because it could be changed at any time.

George Young: I have a simple question for the Minister. He referred to the borrowings of the organisations that will form the HCA—the Housing Corporation, English Partnerships and the Commission for the New Towns—and I think he said that there were some outstanding borrowings in some of those organisations. Will those borrowings be rolled into the borrowings of the HCA, or will the HCA start with a blank sheet of paper so that the £2,300 million will refer only to liabilities that it itself incurs? Will it have responsibility for the debts of its predecessor organisations?

Robert Syms: I wish to make a similar point. Evidently, the organisations to which my right hon. Friend referred already have an external borrowing limit. Is the £2,300 million new money or is there a sort of net difference? Are these additional resources or are they the resources of the organisations that are forming the HCA? What are the external limits of English Partnerships, of the Housing Corporation and of the Commission for the New Towns? What I am trying to get at is this: is it new money or is it reannounced?

Iain Wright: That was an interesting point about borrowing limits, certainly from my point of view as a former auditor and accountant. I reiterate what I have said in earlier discussions. The power of the homes and communities agency to borrow is an important part of its financial powers, because it gives it additional flexibility. I refer to borrowing either on a short-term basis from anyone or on a longer-term basis from the Secretary of State or the European Investment Bank.
Let me clarify the point made by the hon. Member for Poole. The amounts that we are proposing for the borrowing limits of the HCA are those currently available to the Housing Corporation. Those amounts were increased from those originally allowed in the Housing Associations Act 1985 by the Housing Act 1988. The agency will be a bigger agency than the Housing Corporation. It does not seem reasonable to expect the new agency to do more than the combined roles of its constituent parts while at the same time restricting its ability to borrow to less than that of its constituent parts. We have taken the view that retaining access to this amount of borrowing is reasonable, given the breadth and wide variety of work being undertaken by the new agency. It seems reasonable; it does not seem excessive. It will not be the main source of its funding. I therefore hope that the hon. Member for North-East Bedfordshire will withdraw the amendment.

Alistair Burt: I may well do that, but before we leave the amendment, can the Minister give an indication of what the main sources of funding will be for the HCA? Where will it get its money from?

Iain Wright: The main source of funding, as I thought I had made clear earlier, is grant in aid from central Government. That will be the main source of funding, I imagine, that the agency receives. I hope that that clarifies the matter.

George Young: I may have missed this, but I did not catch from the Minister whether the HCA would take over the existing liabilities of the organisations from which it is composed.

Iain Wright: My strong understanding is that the existing borrowings will be transferred to the new agency. It is essentially a residual rump from former borrowings. I am sure that if I have got that wrong, I will be corrected, and I will make the Committee aware of that, but that is my strong understanding. It is a residual rump that is not material, but I am happy to provide clarification if I have got that wrong.

Alistair Burt: I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 26 ordered to stand part of the Bill.

Sitting suspended for a Division in the House.

On resuming—

Clause 27

Power to charge for certain activities

Question proposed, That the clause stand part of the Bill.

Nick Raynsford: Clause 27 covers the power of the HCA to charge for certain activities. It is obviously appropriate that, where the agency provides services and research, there should be the capacity to make a reasonable charge for that. Indeed, I understand that the existing bodies, the Housing Corporation and English Partnerships, currently do that. My concern is that the power as defined in the clause, certainly in subsection (1), appears to be limited to anything done by virtue of clauses 41, 42 and 47. Clause 42 covers training and advisory services and it looks sensible and straightforward.
Clause 47 needs closer examination because it states that:
“The HCA may provide services in support of a project.”
It defines those services as seconding staff; providing consultants or other manpower resources to a project, or; lending or providing technical, property or other resources. That is all fine in theory, but what is the definition of “a project”? Could that be unduly restrictive? Does a project refer simply to a single housing scheme supported by the new agency, following on from the ability of the Housing Corporation to provide funding for a particular housing scheme, or does it go wider? Could it cover new regeneration initiatives that perhaps will apply in a number of different areas or projects—I am using the plural—that will have different outcomes in different parts of the country? Might that fall foul of a definition that appears to be limited to anything that is done in support of “a project”? I do not know the answer.
I am puzzled by that matter and slightly worried that when we see the agency operating, the definition of “a project” might unduly restrict its ability to offer technical support, consultancy, advice and other assistance to enable worthwhile regeneration or other initiatives to take place. We might all support and regard them as sensible and admirable activities, but they might be prevented if the definition of
“in support of a project”
proves unduly restrictive. I am simply seeking guidance on whether that definition provides for the full range of circumstances in which it would be appropriate for the HCA to provide support and to charge for it in order to defray the costs.

Iain Wright: Personally, I think that the clause is important because it empowers the HCA to charge. In doing so, we get a bit of a sneak peek into what it will do and how it will help local authorities and others to step up to the plate. I would like to refer you to the objects of the HCA, Mr. Benton. It is tasked with supporting
“in other ways the creation, regeneration or development of communities in England or their continued well-being”.
It will do that by working with local authorities and other stakeholders by being an expert delivery partner. The expertise and experience that already exist within English Partnerships and the Housing Corporation will transfer to the agency. That means that the new agency has the potential to be incredibly innovative in the way in which it takes regeneration forward. That could be in providing advice, training and consultancy services to drive forward projects that otherwise would never get off the ground.
Additionally, something that I am interested in and that we do not talk about often enough is the Academy for Sustainable Communities, which will go into the agency and effectively act as an operating arm of the HCA. That will carry forward its work to improve the skills, knowledge and behaviours that are needed to deliver and to maintain sustainable communities. The power in the clause will enable the academy, and then the agency, to charge for the information, advice, education and training support services that they provide.
The clause is intended to enable the HCA not to make a profit from providing those services, but to make reasonable charges to recover the costs that it incurs as a result of providing advice or operating a particular service. It would be unreasonable to require the agency to provide such services without allowing it to recover costs, where it considers it to be appropriate. If the agency were to provide these types of services free of charge, it could lead to it being exploited. We do not want that to happen. It was suggested earlier that we do not want private sector developers and others to see this as a green light and a cash cow. We believe that the agency should be able to make a reasonable charge for those services. That is only right and fair.
I want to come on to an intriguing point that my right hon. Friend the Member for Greenwich and Woolwich made with regard to the power to charge under clause 47, and the reference to “project”. We may return to that matter when we consider clause 47, but my understanding is that the word “project” is used to suggest a time-limited involvement. To remove that word may suggest that the HCA would be involved indefinitely, and that is not the best use of resources. The intention—this will be true for a range of things that the agency does—is that the agency will provide support to schemes to enable them to get to a position where they are either complete or self-sufficient. The duration of that will vary quite widely depending on the scheme, but “project” is deliberately not defined, so as to ensure that it has its natural meaning, which suggests a time-limited span with particular outcomes.

Nick Raynsford: I accept the point about the time-limited nature of “project”, but I was also asking about geographical spread, because a “project” could be interpreted as referring only to a particular area. If there were an initiative that involved projects in several different areas which depended on an input of consultancy from the agency, and that were interpreted as going beyond the remit because it was not a single project, but a series of projects in different areas, might that be a problem? I ask only because I want to be quite certain that this will not prove unduly restrictive as an interpretation. I entirely accept all the points my hon. Friend has made, but I would ask him to give a little further thought to the question of geographic spread, and to whether a number of different projects might fall foul of the definition.

Iain Wright: Let me look at that matter again, because my right hon. Friend makes an important point. We had an interesting debate on Thursday on community land trusts. I imagine that he agrees that community land trusts’ expertise would be disseminated to relevant local authorities. I certainly see that as being within the clause. Let me look at the matter afresh. We may come back to it shortly when we deal with clause 47.

Margaret Moran: When my hon. Friend reviews the measure, can he look at its scope? The Centre for Research and Market Intelligence is the research and innovation part of the Housing Corporation and I assume that it will be subsumed by the new agency. It deals with some innovative work. It has done work around procurement and around best practice in equalities, for example, which is not project-specific, but more wide-ranging. It is leading edge in terms of best practice, which I know my hon. Friend will want to see from the new agency. I am a little concerned that the wording here may be a little restrictive and may inhibit that kind of best practice project from going forward.

Iain Wright: I appreciate the comments of my hon. Friend. I think that she agrees that one of the things that we want to see is the dissemination of good practice. The agency will be a repository of that, and I do not want to see anything within the Bill to prevent that from happening. I ask her and my right hon. Friend the Member for Greenwich and Woolwich to let me look at the matter again. I am fairly confident that, with the definition of “project” as it is, that would be allowed to happen. One of the arguments that has been teased out of the Conservative party is, and I paraphrase, that they do not want homes, and one of the reasons they do not want homes is that we do not have the relevant infrastructure. I suggest that dissemination of good practice would be the bread and butter of what the agency will be doing, working in conjunction with local authorities. I reiterate that I do not want anything that would compromise that within the Bill. I hope that we can come back to that during consideration of clause 47.

Question put and agreed to.

Clause 27 ordered to stand part of the Bill.

Clause 28 ordered to stand part of the Bill.

Clause 29

Duty to act as agent in respect of regeneration and development

Question proposed,That the clause stand part of the Bill.

Alistair Burt: I have a couple of questions in relation to the next two clauses. First, will the Minister say in what circumstances the Secretary of State will appoint the HCA to act as agent in the manner described in clause 29?
Secondly, when talking of the HCA’s power as agent of the Secretary of State on matters of regeneration, I wish to raise a particular issue. I understand that the Housing Corporation does not provide finance to schemes in which there is no net increase in affordable housing. In areas that have the potential to increase housing supply and that already have an over-concentration of council housing, making a more mixed community would involve a net loss of council housing. Although it would result in a much more balanced community, which is the desire set out in the Green Paper, such a scheme would not attract financial support.
Will the Minister say whether the HCA might take a more flexible approach? I am talking of a situation in which there was not necessarily a net increase in affordable housing. Would it still be possible for financial assistance to be given to a scheme whose objects were within the terms of the HCA’s remit—within its wider powers over regeneration, rather than simply its powers to act as an agency to deliver more housing units?
How will the HCA use its powers, and will it be more flexible than the current provisions as they affect the Housing Corporation? I should be grateful if the Minister gave us some indication on that.

Robert Syms: I, too, would like a little clarification on clause 29. I may be wrong, but it seems that the Secretary of State can give the agency a role—for instance, to dispense grants. Does that mean that grants that would now be given directly to local authorities will go to the agency to be dispensed? As someone who spent 14 years in local government, my concern is that it should not be used to get around directly funding local authorities or boroughs.

Iain Wright: Let me provide some clarity. Sections 126 to 128 of the Housing Grants, Construction and Regeneration Act 1996 give the Secretary of State the power to give financial assistance in respect of expenditure on activities that contribute to the regeneration or development of an area. In simple terms, that means that the agency can step into the shoes of the Secretary of State and give financial assistance in support of regeneration or development activities in particular areas; it is appointed as an agent by the Secretary of State.
However—I return to this point time and again—the agency must act in accordance with the terms and conditions of its appointment, as set out by the Secretary of State, and crucially it will still need to act within the confines of its objects as stated in clause 2. In practice, the agency will be enabled to administer regeneration funding programmes, which are currently delivered by the Department for Communities and Local Government. The power will enable the Secretary of State to appoint the Homes and Communities Agency to perform a number of functions that are currently performed by the Department.
On Thursday, we had a debate about the vision of the Department and it providing a strategic role on what is needed in respect of housing and regeneration, with the HCA being one of the delivery agents. Many of the delivery functions currently performed by the Department are being transferred to the agency. We are doing something similar in clause 19 in order to build on that. The Government believe that it is vital that investors have clarity on the arrangements for delivering those commitments, and I hope that we have provided that clarity.
I hope that I have provided some certainty for the hon. Member for North-East Bedfordshire—but he looks slightly confused.

Alistair Burt: I just want an answer on the points about the flexibility of finance and about the Housing Corporation not funding schemes in circumstances in which there is no net increase in affordable housing. Will the new agency take a different view on that?

Iain Wright: I am furiously looking for clause 2.

Alistair Burt: Some inspiration is needed.

Iain Wright: No; I am fairly happy with the inspiration here, although I could now be contradicted. Clause 2 states that the objects of the HCA are:
“to improve the supply and quality of housing in England...to secure the regeneration or development of land or infrastructure in England...and to support in other ways the creation, regeneration or development of communities in England or their continued well-being.”
Those objects are important, and the hon. Gentleman’s points would satisfy those criteria.

Alistair Burt: May I understand that the Minister is answering “Yes,” and that he does not expect the current restriction operating through the Housing Corporation to continue under the new agency in the specific circumstances that I mentioned? If so, I am happy to hear that. As my point is very specific, I am perfectly content if he wants to write to the Committee. I do not know where his inspiration is leading him at the moment.

Iain Wright: I understand that I am intervening on the hon. Gentleman, Mr. Benton. Will he clarify the particular circumstances that he means? He mentioned affordable housing and the housing market renewal area; which particular areas is he concerned about and what would he like me to clarify?

Alistair Burt: My understanding, from an expert who works in the regeneration field, is that the Housing Corporation will not supply finance to a scheme in which the overall end result will be fewer affordable houses. In some development areas, there is opportunity to expand the housing supply in the round, including more mixed developments—more private housing and home ownership—by taking out some council housing in places where there is an over-concentration, such as on the monolithic-type estates that we are trying to get rid of.
The Government’s Green Paper supports the development of more mixed communities, but money is not available through the Housing Corporation if a point of principle on affordable homes is breached. The thinking is, “There will be fewer affordable homes, so how can we give money to this?” If the Government’s aims and objectives were slightly broader than simply building more homes and units, which is the charge that has been levelled against the agency, and if there were an allowance to supply finance to that sort of scheme if a more balanced community were being created, even though there would be a net loss of affordable homes, would that restriction be lifted?

Iain Wright: That helps an awful lot and clarifies the question. The agency’s objects are wider than the Housing Corporation’s, and I do not want to pass judgment regarding the circumstances that the hon. Gentleman mentions. I mentioned the housing market renewal area because I have ministerial responsibility for it, and I have been to your constituency to have a look around, Mr. Benton, and really enjoyed my time there. A relevant consideration might be an over-preponderance of two-up, two-downs and that we need to lower the density. In such circumstances, that would be entirely reasonable. However, the whole objective is to improve the supply and quality of housing in England. I hope that I have reassured the hon. Gentleman.
The housing market renewal area and possible phased and planned demolitions are a good example of how we need to improve the housing stock. That might mean fewer houses in that particular area; in that respect, I agree with the hon. Gentleman. I hope that I have clarified matters.

Question put and agreed to.

Clause 29 ordered to stand part of the Bill.

Clause 30

Duty to act as agent in respect of derelict land etc.

Question proposed, That the clause stand part of the Bill.

Alistair Burt: I want to raise an issue that was brought to our attention by the CPRE, which wants to ensure that the work of English Partnerships on having an up-to-date register of brownfield land will be continued, especially given the amount of time and money that has been invested. It originally proposed that a new clause be tabled, which would have been headed, “The duty to monitor and promote the re-use of brownfield land”. The new clause would envisage the new agency identifying, collating and publishing up-to-date information on
“the availability, including type and location of previously developed (i.e. brownfield) land in England at district, regional and national level.”
That data would be kept under review and published annually, and the agency would
“promote the re-use and reclamation of brownfield land by acting as the Government’s statutory adviser”
on it. The CPRE made the following point:
“To make the best use of our brownfield resource, and reap the benefits in terms of urban renewal, it is vital that English Partnerships’ work on the National Land Use Database and National Brownfield Strategy continues. Given that housing is the HCA’s priority, CPRE fears this work could be sidelined should the HCA face pressure to deliver housing numbers or cut costs. This would be short-sighted, given the huge resource brownfield land represents and the need for action to tackle brownfield blight and dereliction in ways which can improve the quality of life of existing communities.”
I wish to take the opportunity to reiterate how important that work on brownfield land is, and that it should be continued by the agency, whether or not under the specific powers in clause 30 on its duty to act as an agent in respect of derelict land or elsewhere. I know that the CPRE will appreciate that.

Iain Wright: I will be brief. I can confirm that that will fall within the Homes and Communities Agency’s objects, and there is no reason why it should not be continued. The hon. Member for St. Ives made a similar point during the oral evidence sessions. Having said that, although I want to provide reassurance that the regeneration activities and programmes carried out by English Partnerships will continue, as they will be fully within the agency’s remit, I do not want to tie up too much the specific managerial responsibilities regarding where the money and resources will be allocated.

Question put and agreed to.

Clause 30 ordered to stand part of the Bill.

Clause 31

Business

Question proposed, That the clause stand part of the Bill.

Lembit Öpik: The clause means that the HCA can do anything—make films, run shops, go fishing—because it
“may carry on any business.”
I do not have a particular problem with that; my only concern is the risk of mission creep. It is important that the HCA is focused on its primary duty, in line with the objects that we agreed in an earlier sitting. I seek assurance from the Minister that it will not be expected to over-reach itself, going way beyond the original intentions of the Bill.

Iain Wright: Yes, I can confirm that the agency will be able to do anything that it likes. However, it must be purely within its objects. That has been made very clear.

Question put and agreed to.

Clause 31 ordered to stand part of the Bill.

Clause 32 ordered to stand part of the Bill.

Clause 33

Community services

Question proposed, That the clause stand part of the Bill.

George Young: I rise briefly to see whether I can settle a score with the Minister. Does he agree that clause 33(1) comprises a list? Does he remember what he said a few sittings ago about the problems of lists—that they elevate one strand above another? He said:
“Singling out any specific strand of housing would place a duty on the agency in relation to that type of housing.”——[Official Report, Housing and Regeneration Public Bill Committee, 10 January 2008; c. 159.]
Yet on community services, apparently lists are all right. The list is not comprehensive at all; there is nothing about training, pre-school or sport. Can the Minister provide a cogent explanation of why, earlier in the Bill, lists were out, but at this stage, lists are in?

Roberta Blackman-Woods: Can the Minister confirm that subsection (1)(d) will mean that the HCA should pay attention, in determining what is an attractive environment, to the need for communities that are being developed or regenerated to have a sensible provision of open and recreational space? I am sure that he is aware that some local authorities, such as mine, in Durham city, seem determined to build on every single open space available, regardless of the views of the local community or the impact on it. Will he confirm that the HCA will not be similarly encouraged?

Andrew George: I enjoyed the point made by the right hon. Member for North-West Hampshire about the clause being a veritable list. Indeed it is, but it does not include provision of housing. The objects of the HCA in clause 2(1)(c) make reference to the
“development of communities in England or their continued well-being”,
which clause 33 is clearly intended to address. My questions for the Minister return to the point that my hon. Friend the Member for Montgomeryshire made a moment ago about constraining mission creep. Who will decide how to apportion the agency’s resources so that it can concentrate on its primary purpose? How will it make those decisions? How will it fund the provision of cemeteries and recreational services? How will those interplay with the role of local authorities? Will it undermine statutory provision elsewhere, or bail out local authorities from those provisions?
A moment ago, in relation to the stand part debate on clause 30, the Minister referred back to questions that I raised about the continuing work of English Partnerships in relation to the provision of work spaces, which is not mentioned specifically in the list in clause 33. One would assume, therefore, that it has been overlooked in the list. This is purely a probing stand part debate, but it would be very helpful if he could address the need for clarity in the interrelationships between the HCA and the communities that it will serve.

Robert Syms: I rather agree with the last points made. If there is going to be a major development, support services will be needed. One can easily see a need for security guards and so on. However, under the terms of clause 33, existing businesses might well face competition from organisations supported by the HCA. My concern is whether there is a code of conduct, because, for example, if the HCA sets up a transport service in competition with a private business, it might be unfair. I shall not labour that point, but I am concerned that the moment that we allow an organisation to enter into any business, we might come up against small businesses.

Nick Raynsford: I have been goaded by the comments on the lists made by the right hon. Member for North-West Hampshire, so I shall add my two penny’s worth. I have no objection to the list set out in clause 33(1), which seems to provide a broad definition of the kind of community services that are likely to be supported by the HCA. It could be said to be a cradle-to-grave definition, although there seems to be a rather strong emphasis on the latter end of that process, given that “cremation or burial services” are specifically identified. I referred back to clause 31 and was surprised that the only listed business is undertaking. I wonder whether that meant the particular service being considered in clause 33(1)(g)(iv). However, on the assumption that it will genuinely be cradle to grave and that there will be no bias against the provision of maternity services, when appropriate, I give my strong support to the clause.

Alistair Burt: This has been a nice little debate to take us to the end of this afternoon’s proceedings. I was delighted that my right hon. Friend the Member for North-West Hampshire could make an intervention modelled closely on the intervention that he made earlier in Committee, to which I was pleased that the right hon. Member for Greenwich and Woolwich responded. It is the end of the day, so it is perhaps appropriate that we consider burial and undertaking services. Moreover, perhaps that highlights the dying embers of a Government who are peacefully drawing to their close, and why the services that are listed have drifted quite subconsciously in that direction. I can well understand how such a subliminal sense has affected Labour Members.
However, I have two things to add to the general merriment about such a lovely catch-all clause. I wish first to ask the Minister quite a wide question, but it is based on the measure to which the hon. Member for City of Durham referred when talking about providing safe and attractive environments. Will anything in the new agency act as a driver to ensure the provision of more family housing? We covered that matter in the evidence sessions and it has come up before in general debate. Developers know that at the moment, one-bedroomed and two-bedroomed apartments fly out the window in certain areas. They cannot build and get rid of them fast enough.
Family housing is much needed to ensure that there are mixed and balanced communities, but few provisions drive developers in that direction. Will the Homes and Communities Agency be any more successful in delivering the main object of the agency stated at the beginning of the Bill, and comply with the clause to provide safe and attractive environments?
My second point is similar and relates to design. I hope that the Committee does not mind if I use as a brief not a piece of paper but an electronic device, because it contains information that, had it been written down, I would have used in the same way. I shall be quick. Critics of the Bill are disappointed that it does not contain specific mention of design, and I wonder whether the phrase
“provide safe and attractive environments”
will allow the agency to take more notice of my proposal. The Minister said earlier that the Academy of Sustainable Communities was coming inside the agency, but no reference is made to the Commission for Architecture and the Built Environment. A recent CABE report drew attention to a problem that highlighted the concept of safe and attractive environments.

Robert Syms: My hon. Friend is raising a good point. As I understand it, Bedfordshire police have an architectural consultant who consults on schemes mainly from a point of view of safety, but also on the quality of particular estates that are built in my hon. Friend’s county. To meet some of those objectives, design and indeed input from other bodies are important.

Alistair Burt: Such matters have come up in the margins of our discussions. They were referred to in our evidence session, but now is the appropriate opportunity for the Minister, in responding to this short debate on clause 33, to illustrate how important design is to him and to the general welfare of communities, particularly in respect of safe and attractive environments.
I draw attention to a recent CABE report, which was published in December. It reveals that although new home owners like their homes, almost half miss a sense of community spirit. The report is titled, “A sense of place” and based on an Ipsos MORI survey of more than 600 residents of 33 new housing developments. It points to a quality blind spot that suggests that house builders and planners need to work much harder to create a sense of place. Paradoxically, although 91 per cent. of respondents were satisfied with their new home, there was widespread dissatisfaction with the wider development. The report states:
“45 per cent say that”
their neighbours
“go their own way rather than doing things together and trying to help each other”,
that
“40 per cent thought that there was not enough public open space”,
which was the point made by the hon. Member for City of Durham, and that
“48 per cent thought there was not enough play space”,
or perfect places to get to know each other. More than a third of residents thought that their neighbourhood
“was unsafe for children to walk, cycle or play in”,
and almost a third thought that it
“did not have a distinct character”.
Those resident survey findings are consistent with the problems of layout, character and public space that CABE identified in its first national housing audit, which was completed in February 2007.

Andrew Love: I saw the results of the CABE study. Does the hon. Gentleman agree that if we looked up and down the country, we might find estates, towns and cities that have been redeveloped since 1945 that won awards at the time, but are now considered blighted? If we are to address the issue that he described, we need to do more than find a new design or architect; we need to build new estates in consultation with the people who will live on them.

Alistair Burt: Very much so. The hon. Gentleman made an extremely good point. It is difficult for professionals or laymen and women to look at designs and say what will work in 20 or 30 years. However, it is clear that if we do not pay attention to design or look at the mistakes of the past, and if we are driven by targets of numbers, there is a danger that the things we are discussing will be squeezed out. Will the Minister reassure us that concerns about the quality of design and new estates will be at the forefront of the housing and communities agency, and that concerns that it will be a purely target, numbers and unit-driven agency that at the behest of Government has to get its numbers up, will not come true? We hope that there will be a place for design and some reassurance that that will be brought into the body of the agency in some manner. That would be helpful.

Iain Wright: I have enjoyed the debate, which has been good natured and well meaning given that it has come at the end of the day.
I detect two main themes: first, the list principle and, secondly, the importance of design. The right hon. Member for North-West Hampshire rightly criticised me in a gentle manner on the list principle. We can go back to our similar debates on infrastructure—I draw his attention to clause 2(3), which sets out what infrastructure means. Essentially, the measure is based on the same principle and will avoid doubt. That is entirely what clause 33(1) will do. I mentioned the thriller in Manila last time, and I enjoyed the two Privy Councillors joshing again. However, the measure will avoid doubt as much as possible.
Hon. Members mentioned the importance of infrastructure and the relationship that other providers, such as Government Departments, will have with the agency. It might be that a site is not attractive to a developer because, for example, there is a lack of transport access, but if the agency delivers the necessary infrastructure, a private developer might take on the wider development. Therefore, if the HCA builds the infrastructure, the wider development may be more viable for the private developer.
It is reasonable for hon. Members to ask whether the measure provides a facility that Government Departments or local authorities should provide—that point was made by the hon. Member for Poole. The agency will work in conjunction with the Departments and authorities that lead in such areas. The Government see the agency as complementing the activities of those bodies and as helping to drive forward regeneration and housing where necessary, as opposed to leading on those matters.
I pay tribute to the hon. Member for North-East Bedfordshire because he made an important contribution on design and planning. He is absolutely right. He reiterated a point made by my hon. Friend the Member for City of Durham. As I mentioned in the evidence sessions, we cannot have a similar debate in 20 or 30 years’ time. We need sustainable communities, and their design and planning is essential. I am tempted to say “sustainable and inclusive communities”, but I had best not this time. It is essential, however, that we factor those things in. It is right that in a modern economy where people are busy and travel to work we need to have that sense of community, and recreational facilities and open spaces allow the community to come together.
I suggest that we have provided guidance with regard to planning policy statement number 3, which is about housing. Frankly, local authorities need to be more robust in rejecting planning applications that do not come up to the standard for design and quality. Local authorities should be forthright and it is right that they should play the lead on that, but I agree with what the hon. Member for North-East Bedfordshire said and reiterate the point about the Academy for Sustainable Communities. I think that the agency will be working with the Commission for Architecture and the Built Environment to ensure that we drive up quality, but his point is well made and I agree with every word he said.

Question put and agreed to.

Clause 33 ordered to stand part of the Bill.

Clause 34

Sustainable development

Andrew George: I beg to move amendment No. 102, in clause 34, page 15, leave out lines 7 to 9 and insert—
‘(1) This section applies to the HCA in exercising any function set out in Part 1 in relation to: land acquisition, land disposal, planning, provision of infrastructure or highways adoption.
(2) The HCA must exercise the functions listed in subsection (1) with the objective of contributing to the achievement of sustainable development.’.

Joe Benton: With this it will be convenient to discuss amendment No. 101, in clause 34, page 15, line 7, leave out from ‘HCA’ to end of line 9 and insert
‘shall exercise its functions with the objective of contributing to sustainable development.
(1A) The Secretary of State may issue guidance to the HCA for the purposes of this section and the HCA shall have regard to any guidance so issued.’.

Andrew George: I shall be brief in view of the time. The clause as currently written is thin, given the Government’s commitment on climate change, the Climate Change Bill, the endorsement of Stern and everything else. All that the clause says is that the HCA “may” contribute, but it may not. There is no commitment there whatsoever.
While the objectives of the agency are worthwhile in themselves, delivering housing must take place in the context of the Government’s objectives for sustainable development. The 2005 UK sustainable development strategy, “Securing the Future”, established the goals of living within the environmental limits and providing a just society by means of a sustainable economy, good governance and sound science. Those are guiding principles that should underpin the delivery of housing and apply to all public bodies in the exercise of their functions. For example, local planning authorities must exercise their functions
“with the objective of contributing to the achievement of sustainable development”
in preparing local development documents under section 39 of the Planning and Compulsory Purchase Act 2004.
The need for sustainable development is one of the most pressing issues facing decision makers. It is highly regrettable that the HCA has not been given a strong duty to achieve that. That duty should be accompanied by guidance on how to carry it out, how it should be monitored and it should also be reported on annually in the report the HCA is required to undertake under paragraph 11 of schedule 1. I hope that the Minister will bear in mind the need to make a more robust statement on that.

Iain Wright: I am not sure whether the hon. Gentleman was here during the consideration of an amendment to clause 2 to hear the comments of my right hon. Friend the Member for Greenwich and Woolwich. I agreed that I would look at that and come back. I want to have a look at comparable bodies such as regional development agencies and the Greater London Assembly and am mindful of what the hon. Gentleman said and hope to bring something back on Report. I hope that he will withdraw his amendment on that basis.

Andrew George: I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.
Further consideration adjourned.—[Liz Blackman.]

Adjourned accordingly at one minute to Seven o’clock till Thursday 17 January at Nine o’clock.